Customer relationship management (CRM) software is designed to help organizations increase customer loyalty, target their most profitable customers, and streamline customer communication processes. CRM helps firms gain and maintain a competitive advantage by: 1) segmenting markets based on demographic and behavioral characteristics. 2) tracking sales trends and advertising effectiveness by customer and market segment. 3) identifying which customers should be the focus of targeted marketing initiatives with predicted high customer response rates. 4) forecasting customer retention (and defection) rates and providing feedback as to why customers leave a company. 5) studying which goods and services are purchased together, leading to good ways to bundle them. 6) studying and predicting which Web characteristics are most attractive to customers and how the website might be improved.
